Aim- and TSX-V-listed Mkango Resources has conditionally raised gross proceeds of £1.25-million through the issuance, on a private placement basis, of 25-million units of about 5p each.

It plans to use the funding, along with €200 000 raised from EIT RawMaterials, to advance its portfolio of advanced-stage rare earth assets.

EIT RawMaterials will, subject to the approval of the TSX-V, provide funding of €200 000 to Mkango for a 5.7% interest in Mkango Polska – a 100% held subsidiary of Mkango, which is developing the Pulawy rare earths separation project, in Poland.

This funding will be used to start process optimisation at Mkango's Songwe Hill rare earths project, in Malawi, which will be a future source of mixed rare earth carbonate feed for the Pulawy project. 

The £1.25-million raised in the private placement will, meanwhile, be used for the acquisition of additional equipment for the 2025 commercial development of rare earth magnet recycling operations at the Tyseley Energy Park, in Birmingham, in the UK, and at Pforzheim, in Germany, by HyProMag and HyProMag GmbH, respectively, in addition to working capital.

Mkango holds a majority interest in HyProMag and HyProMag GmbH through its Maginito subsidiary.

"In light of progress being made by HyProMag as it progresses towards commercialisation of rare earth magnet recycling in the UK and Germany and completion of the US feasibility study, and with the recent signing of the mine development agreement for Songwe Hill, existing shareholders were happy to continue to support the company with further investment at a minimal discount to prevailing prices.

"Furthermore, the investment by EIT RawMaterials further highlights the strategic importance of Songwe Hill and Pulawy to the strengthening of rare earth supply chains in Europe and beyond," says Mkango CE William Dawes.

He adds that the company believes there is additional value to be unlocked from both Songwe Hill and Pulawy that is not reflected in the company's current market capitalisation and will be considered in a review of strategic options for the project.